Curving the Arc of European Politics and Yanis Varoufakis by Barbara Cerda #politics #Varoufakis, #EU

Something awesome happened during the period of the Greek economic crisis. Through the angst of monetary collapse, the nascent politics of FM Yanis Varoufakis’ came to be. It was a quiet emergence from a womb of bitter contention. Everyone understood that the Greeks were getting a raw deal. It was a matter of signing on the dotted line for that balloon payment that came due far to quickly. Fairness be damned, what creditors agree to renegotiate in the favor  debtors?

An unnoticed uprising found its voice in the oft time boisterous but very handsome Yanis Varoufakis. Compelling because he’s smart and a rebel.

Compelling because he’s the elegant eloquent professor of a new Greece… the conscripted soldier of an economic over throw. His army is growing in the face of another upstart or …. a reawakened conservative movement. They are an opposing force, bound to collide.  I think the outcomes will shape global economic futures. The BRICS will have to rethink trading agreements. FANG will become toothless in its formation of trading partners. And why you say? The monetary influencers, regulators, will focus on the biggest economic engine gaining steam, a politically mature and stable EU.

Led by Angela Merkel, the EU is growing in governmental and economic power. Even immersed in partisanship, the Germany collective mind is centric and owns sovereign pride. And it’s the leader of a block of countries that are economically united. Pinching one… the group yells ouch.

There’s a growing need within the populace of Europe to resist embracing the idiocies of the singularity in religions and the politics of “the other”. Neither mindset serves the greater purpose to increase power by way of sound economics and GDP growth.

This type mindset is heresy and is slowly eating at the economic marrow of the current global influencer, the United States. While Americans have allowed the corrosive politics to consume its confidence and economy, Europe is coming into its own. Professor Varoufakis gets this. And has preached this for over a decade. Now the young and liberal are excruciatingly slowly growing into a new European state.

The oligarchs of corrupted wealth are gazing nervously in their rearview mirrors.

Whether intentional, intuitive, or just the product of a financial upheaval, Varoufakis has become the leading nemesis of passé’ oligarchs. The Greek socio-economists has become the emerging leader in a world facing melting borders and monetary shifts.

Coupled with America and the UK’s tumble down the rabbit hole of sectarianism, the EU culture gains control. It’s becoming the stronger influencer of financial exchanges and sovereign border agreements.

DIEM24 is his love child.

Genuine politics is a powerful art. The owner of that talent wields global outcomes. In my opinion, a reconfiguration of global wealth can be anticipated… it’s a given. And history will note that SYRIZA versus Varoufakis was its impetus.

 

 

ANGELA MERKEL AND BARACK OBAMA’S GOVERNANCE SHAPED BY CULTURAL SIMILARITIES by Barbara Ann Cerda

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It’s as if by magic that we expect the world economy to suddenly correct itself; even more to expect our populaces to elect leaders with miraculous qualities of leadership. We listen to the content in talking points to assuage our hungers for balance and plenty. We often forget that leaders are people and people bring to offices of governance a lifetime of personal experiences. Cultural histories dictate moments when change is marked by populace uprisings. That has not changed. Some call them collective moments of awakenings. It is most commonly economic hardships that initiate and promote sociopolitical change.

Two global leaders have emerged from populaces whose cultural ideologies are shifting like sand ergs.

Their faces don’t resemble those that came before them. Out of the morass and cacophony of social revolution, two geopolitical leaders have emerged. Both claim citizenship in countries that at one time held polar opposite ideologies and racial composition. Their names are President Barack Obama and German Chancellor Angela Merkel.

As I wrote in a previous article about German Chancellor Angela Merkel, she was born and educated in a radically divisive society. She first came to public office the same year of the German Reunification in 1990. She witnessed Germany’s horrendous post war scars that were brought on by an economic twilight. Every fiber of Angela Merkel’s being embraces the concepts of frugality and moral hazard. She did not have an unencumbered path to power. She created successful ways while collecting political wisdom with each step. Social and economic divisions forged the steel of her individualistic persona and the style in which she now faces economic and political crises. With the election of President Elect Donald Trump, she is the solitary leader of the last bastion of Liberal Democracy.

Although a conservative Angela Merkel and Barack Obama’s approach to governance is shaped by cultural similarities.

President Barack Obama’s political beginnings were fomented in the perfect political petri dish of the Chicago Democratic machine. Known for its rough sophistication and political dynasties that were known as king makers, he became the occidental conservative Democrat. The political machine mentored him, taught him, supported, and carved out a political niche. A child of a broken home that reconstituted itself around a loving mother and grandparents, his education in how to survive and achieve as an outsider is part of his DNA.

A drive to become a populace leader became central to his self-perception.

Anyone who has entered the apartments or sat in the playgrounds of the slums of Chicago Housing Authority (fondly called the CHA), understands the true meaning of how difficult the role of a community leader. In a racially divisive urban environment, the Community Organizer and future president Barack Obama sat listening to problems and challenges facing families living in high-rises with broken elevators. Unclean odors drifted from garbage-filled corridors. Cheaply dressed well-scrubbed children played in yards barren of grass, but decorated with spent bullet shells and broken glass bottles. He listened to the challenges of living in one apartment or townhome sometimes housing three generations of welfare poor. The Community Organizer Obama labored within political systems to make life easier for families trapped within the hard unforgiving political web of Chicago. Frustration drove him to attend Harvard Law. He graduated with honors and returned to Chicago’s Southside to resume his advocacy for the poor.

In a speech published in the Chicago Hyde Park Herald on October 30, 2002, six years before leading his country through a global financial calamity. The newly elected Illinois Senator Barrack Obama said the following,

“What I am opposed to is the attempt by political hacks like Karl Roves to distract us from a rise in the uninsured, a rise in the poverty rate, a drop in the median income”. He went on to say, “Those are the battlefields we need to fight. Those are the battlefields we need to join. The battles against ignorance and intolerance. Corruption and greed. Poverty and despair.”

President Obama understood then the changing socioeconomic paradigms of our world. He and Chancellor Merkel understood what their predecessors lacked in understanding, the expansion, and responsibilities of their geopolitical roles.

Both face sovereign debt crisis never before experienced. For Merkel it is the Greek tragedy and the survival of the Euro. Her counterpart President Obama has made it clear that as leader of one Europe’s strongest economies, the onus is on her to lead in the difficult path to the achievement of Eurozone solvency. There was no doubt in his voice when President Obama stated that she would overcome the objections of many. She must sift through the constant barrage of mistrust from other leaders and from within her own borders.

To glean the truths needed for a sound and productive discussion. The German Weekly Sie Zeit writes that Obama’s open comment to Merkel was “…Don’t hide behind your history”, said the president. “Act in accordance with your importance”.

An affinity is apparent to any casual observer between Angela Merkel and Barack Obama. It’s hard to understand the world today without the dynamic duo. Without President Obama, the changes that loom ahead threaten geopolitical growth for future generations.

After a meeting in Washington on June 6, 2011, Angela Merkel and her finance minister immediately began putting into place plans to create new initiatives to resolve brewing Eurozone financial crisis. But even then, she lacked populace support. After 10 years leadership, Merkel reluctantly understands that her continuing role is central to Europe’s recovery. With a political realignment of leadership occurring among many emerging markets, the stability of Europe and the United States is important.

The summation of European articles written about President Obama’s relationships with other global leaders surmises that his methods were far different from his predecessor George W. Bush. Never surrounding himself with hangers on or favorites, he preferred to conduct the business of his country with leaders that were of benefit. As a realist, he understands that on the world stage there is more to be considered than viewing other leaders as friends or enemies. President Obama was aware of the fiscal and economic woes at home; he looked for foreign leadership that could help in alleviating the heavy lift of governance.

New leaders of the world – like Angela Merkel must become the problem solvers of today.

The German center left news periodical Suddeutsche Zeitung writes “One shouldn’t count the firecrackers in front of the White House, but rather the number of political projects that could bring together the common interests of America, a superpower, and Germany, the engine of Europe’s economy.”

The resemblances between President Obama and Chancellor Merkel are the struggles of an underdog – both coming of age within a suppressed segment of their societies. Both have extreme love and loyalties to their countries. Both found assimilation as sovereign leaders through education and mainstream mentoring, bravery and extreme intelligence. They are building their alliances upon a base of need for global balance and an acknowledgement of change. Both have statesmen attitudes that serve them well in the international arenas.

When you sit across the table during a G20 summit, the participants wants to know that you’re not communicating in platitudes.

WHAT OF ANDY GRIFFITH’S FOOT TAPPING PORCHES AND THE LOSS OF SMALL TOWN ECONOMICS

Economic change

An argument for smart financial and economic regulation

I offered this piece to Surface Earth on Saturday, July 21, 2012. The solutions then are the solutions now. Most important it is not whether we change our policies and reconstruct our economic protocols…it is how. So far…as we enter the era of President Elect Donald Trump’s nascent administration, indicators are that those who looked to him for relief and change will be disappointed.

In those still moments of reflection we all enjoy imaging the quintessential living space that brings a smile to our lips; for many of us its hot summer nights sitting on a foot tapping porch. The night air is still with only the remnants of warm aromas of home cooking lingering in the air. In our memories are the small towns where the air rang with the rhythmic pats on foot tapping porches. To music accompanied by the harmonic twanging cords of “Salty Dog”. Soft breezes disturb the still heat that contain the smells of honey suckle. This conjures up long forgotten recollections of small towns called Mayberry that contained a Sheriff named Andy Taylor.

The fictional Mayberry R.F.D symbolizes a way of life where the simplicities of common sense economics companioned our daily lives, adding an elusive assurance that all was right.

It was the era of the 1950’s and 1960’s where Andy Griffith helped millions of us to understand that the simplicity of that life was vital and real. It was where a single dirt road led to the house of miserly Ben Weaver the fictional town’s only real estate baron and department store owner. Even Mayberry’s troublemaker Ernest T. Bass held a vital function in maintaining the delicate small rural town economic balance, in the selling and marketing of his moonshine.

When joining the savings club you got a new toaster for your trouble. The banker was your neighbor, realtor, and insurance agent, never your money broker or high finance investment advisor. The passing of Andy Griffith last week was emblematic of the death of a simpler monetary system. Andy Griffith was part of that down home Christian value system. The strong brilliant thread wove tight the fabric that cloaked our dreams. It was during this time that University of Chicago Economic Professor, Nobel Prize winner and Washington policy advisor Milton Freidman was teaching the concepts of the evils of creeping socialism.

Ernest T’s moonshine business was an example of unfettered capitalism. The government agents stalking him in the hills and woods of North Carolina was an early sign of encroaching government imposed socialism, the strangling hold of government regulation on “hooch”. Mayberry was a simplification of the economists’ model and illustration detailed by Adam Smith in his “Invisible Hand “. This concept framed much of what Mr. Friedman embraced. Let commerce reign free of regulations. The markets will dictate what quality is and what shapes the viability of a business. Mayberry was an economic model that demonstrated those concepts.

In Mayberry R.F.D. the veneers of safety, sound mortgage practices and foot-tapping porch homes holding their market value, reinforced our beliefs of future comfort.

Bank savings accounts and nest eggs would be there for generations. Decades later Savings and Loan Banks, unable to compete with the growing number of financial firms offering non-banking services and products were almost put out of business. The markets demonstrated that their viability in a changing global financial environment was not possible. Account holders heard threats of untold losses. Nevertheless, government intervention saved many nest eggs. Then came deregulation and multinational banks grew in unbelievable power.

A decade after the deregulation of banking, investment banker James “Jamie” Dimon, CEO of JP Morgan and non-resident of Main Street, admitted that through dishonesty his firm was suffering a loss of an estimated $4 billion. Then UK based Barclays, known for its clusters of banking businesses revealed cheating in mortgage indexes or LIBOR speculations. Globally dominant in both corporate and investment banking services they contain the largest group of wealth managers. Most recent disaster du jour is HSBC. It dominated business news when their monetary laundering and terrorists’ ties came to glaring light. Huge monetary exposures in the mismanagement of investment funds scandal or mortgage banking cheats have undermined the confidence of the populace in multinational or universal banks. Many politicians parrot the economic phrases of Economist Milton Freidman who spent a lifetime evaluating the reasons why banking should not be government regulated. In the event of another financial meltdown – much of the world’s wealth would be loss.

The regulation or deregulation of our financial institutions is not the only cause and effect of global economic stress.

Blame many of our economic woes on global structural unemployment. It swells liquidity artificially through social benefits like unemployment payments while not addressing the need for full employment. Nevertheless, the late Mr. Friedman shared that any intervention by any government-authorized regulator would merely strangle free enterprise. For example, he cites that when government regulatory artificially sets minimum wage for workers it hampers growth in the private sector. In allowing the job creators to set their own rate of pay, global employers like McDonalds would find it easier to hire more workers at lower hourly wages. Mr. Friedman offers that this is a means to economic stability. It is debated that as long as businesses flourishes under this aegis the society benefits. The realities that are missing are the facts of the burdens on societies in having too many marginalized and under trained laborers. This concept endangers the laborer by marginalizing through inadequate training and encouraging stagnation to upward mobility. This brings to stunning clarity today’s labor market suffering too few well-trained wage earners.

While non-regulated corporations are cultivating over paid executives and feeding a multiplying and greedy stockholder. Multinational corporations thrive.

Yet fiscal uncertainly, vis-à-vis congressional brinkmanship continues to plague projections to healthy outcomes in economic recoveries. A superficial review of Mr. Freidman’s arbitrary observations remains in question. Rather it would be better to cite that the central banks of the world must act as guardians of economies during periods where greed or mismanagement of wealth has created a downturn in economies. If in fact the world held to the views of Adam Smith and Milton Freidman, wild global market fluctuations attributed to Ben Bernanke’s chat events before congress would be non-existent. Yet even Mr. Bernanke must remind the world that he like all global economic regulators, must act within dual mandates.

The dual mandate for the non-governmental agency Federal Reserve System and its FOMC or Federal Open Market Committee is the same as all global economic regulators. In 1977, Congress amended The Federal Reserve Act. Its monetary policy objectives of the Federal Reserve were,

“The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy’s long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices and moderate long-term interest rates.”

The science of economics is not a static concept meant to be biblically applied to humanity. Economics is generic and organic. Our system of capitalisms has created the perfect examples of the social contract. We may weave Adam Smith’s Invisible Hand into the mix of what constitutes our complicated economic system. Nonetheless, it must be argued that our current systems enjoying the benefits of a deregulated commerce, has also fabricated an intricate network of needs for socialization and government intervention.

When an economic construct no longer serves in maintaining the health of the system, it will present like boil to be expunged.

Even foot tapping porches have a place in today’s economy.

Posted by Barbara Cerda
This entry was posted on Saturday, July 21st, 2012 at 3:29 AM and is filed under AP-Business,